For and Against: The Existence of Billionaires

As featured in Edition 38, available here.


BY DOMINIC GILONIS (3rd year/graduate - History - London, England)

and EMILY EVEREST (3rd year - PAIS and Sociology - Surrey, England)


FOR (By Dominic Gilonis)

Wealth inequality has been a perennial problem in all human societies, explicitly or not. Feudal societies were rocked with peasant revolts, the English Civil War unleashed the Levellers, and Karl Marx’s writings continue to inform the most pointed critiques of market economies. With the data techniques of the present, we are able to lay out this issue more clearly than ever before - in the US alone, the top 10% of Americans own 80% of the wealth, while globally just 0.7% of people own 45.9%; at the bottom the reverse is true, with the bottom 70% (earning <$10,000 p.a.) owning just 2.7% of global wealth.


The flashpoint in this argument currently is the ethics of billionaires, those 2,755 individuals who embody the accumulation of wealth so plainly. This article does not seek to justify the status quo in its entirety - after all, the very existence of billionaires presents a problem when there are still people below the poverty line. What it will say though is that accumulated wealth plays a very important role in the economy, and that government led action is not a good solution to this ethical quandary. Instead, the power of social conscience and pressure (a far stronger force in my opinion) should be brought to bear - a process that is already working itself out.


The common arguments against ‘banning billionaires’ are both libertarian and utilitarian. The first emphasises the rights of individuals to the fruits of their labour, and to do with it what they want. Given most billionaires are self-made, this appears strong at first, yet ignores two issues - first, that a lot of this wealth is also the fruit of employees’ labour; and second, that individuals contribute to collectives already through taxation, so why is this not an appropriate measure when it comes to billionaires? It also fails to account for the fact that wealth has diminishing utility the more you have, i.e. a million dollars is life-changing to a factory-worker, less so for Jeff Bezos - so that same amount grants greater freedom if redistribution is employed. The utilitarian argument is that billionaires already provide plenty of socioeconomic benefits that otherwise do not occur. Banks rely on accumulated wealth when issuing loans, allowing greater freedom for the have-nots in society; early consumption of new technologies makes them more affordable in the long-term for all, while large investments in small companies further benefit both entrepreneurs and consumers. Even the apparently frivolous space projects yield prizes - SpaceX employs over ten-thousand people, and likely will stumble across technologies otherwise unknown, like NASA and MRIs.


On top of this, one must consider what the alternative is to the billionaire economy, the commonly cited model being highly redistributive tax policies. The problem with this is that the state has proven to be a fairly terrible spender of money: Test & Trace cost £37 billion in two years, while HS2 is expected to cost over £40 billion more than initially estimated. Billionaire philanthropy has been massively successful by contrast, with Bill Gates’ foundation playing an integral role in the eradication of polio-virus in Africa for example. Without a viable alternative, the argument against the billionaire economy cannot claim utility.


This might miss the point however - the main criticism of billionaires is not just that the wealth could be better managed, but that it should be. The claim is that billionaires have a social obligation to use their wealth to benefit all of society, through taxation or philanthropy. Indeed, most of the utilitarian benefits come from accumulated wealth rather than billionaires themselves. The question then is can humans use such vast sums of money for the good of all, or are external regulations needed to enforce this behaviour?


A huge issue is that humans have yet to devise a socio-economic system that solely encourages and selects for virtue, while leaving no inequality or immorality behind. The Soviet and Chinese models both attempted to empower the state as a moral arbiter for the economy, yet this merely led to the state itself being enriched for its supposedly good work - in fact the gap between the rich and poor in China is rapidly growing.


What seems to be working better is instead social pressure to encourage positive behaviour from billionaires; indeed Bill Gates and Warren Buffett were among a large cohort of the world’s wealthiest who pledged in 2010 to give half of their lifetime earnings to charity. Pressure need not just be vocal - it includes boycotts and divesting of those billionaires who do behave selfishly - and it will not always be effective. However, until someone can develop an alternative system that can truly fix the problem of wealth inequality, this will remain the worst system apart from all the others.


IMAGE: Flickr / Dunk


AGAINST (By Emily Everest)


As the world is inundated by the Covid-driven tides of extreme change and devastation, one relic remains unscathed. Steadfast in its foundations, class society, and the dichotomy it bears between the extremely prosperous and the precariat, has not only persisted, but instead intensified. While billionaires have reaped a great reward, the rest have only been dealt more hardship. Now more than ever, we must question the very existence of billionaires.


In a 2020 report, Oxfam unveiled the extent to which this dichotomy manifested throughout the pandemic. With the world’s 10 richest billionaires amassing over £393 billion since its onset alone, estimates indicate that billionaires’ aggregate wealth will soon hit £9 trillion. These peaks of wealth have occurred in tandem with new heights of people pushed into conditions of extreme poverty, defined as less than £1.50 a day, which has surpassed 125 million within the last year alone and is predicted to reach levels not seen for more than 20 years.


As someone who has struggled to grasp the magnitude of one billion pounds, illustrations comparing it to the minute quantities lived upon by the extremely impoverished are shocking. An individual in possession of a singular billion could spend £1,000, each day for nearly 3000 years, before finally exhausting their finances. Combined with major international job loss, acute income insecurity and general impoverishment have plagued the lives of the many, whilst a minority of the population stand atop a pile of riches. Frankly, the immorality of such inequalities is stark, and the existence of such hoarded wealth abhorrent.


It is this very economic inequality, however, which lies central to capitalism. The works of Marx ring true as wealth forged through the exploitation of workers accumulates in the hands of billionaires. This can notably be seen in the experiences of Jeff Bezos, former Amazon CEO and the world’s richest man, amassing nearly £73 billion since the start of the pandemic. With reports detailing gruelling 14-hour shifts, high injury rates, monotonous labour, and insufficient breaks, the Amazon factory workers, upon which Bezos’ business entirely depends, risk their health and wellbeing amidst the pandemic. Due to a history of union-busting, seen in the firing of outspoken employees, Amazon workers face difficulty in advocating for better conditions without risk of losing employment. This has reached such an extent that a member of Amazon warehouse staff reported relying merely upon the grace of their respective deity as a means of protection. The exploitation workers are subject to at the benefit of billionaires is clear.


Despite attempts on the part of the bourgeoisie to cast billionaires in a light of positivity by drawing upon their acts of philanthropy, such fail to hold sufficient weight. It is important to recognise the contributions of the wealthy, such as the work of the Gates foundation in aiding the radical reduction of Polio, and Bezos’s donations to combat climate change, but also to question these contributions: such acts represent a disconcerting reliance upon the unaccountable wealthy in place of transparent democratic state institutions. In an age of austerity, the location of social investment is largely dependent upon the personal goodwill and fancies of the rich. It is therefore no surprise that such has been critiqued as historically failing to address the collective priorities of local populations, as such voices are ignored.


The extent to which this plutocracy reigns is only exacerbated by billionaire attempts to avoid paying taxes, a critical resource for important country-oriented improvements. Utilizing tax-havens and other loopholes, billionaires notably led to the loss of over £115 billion in US tax revenue in 2017. With US donations proportionally minute in relation to their operating income (at only 0.32% going towards charitable causes in 2019) or to the total quantities spent on the current egomaniacal space race, such philanthropy fails to even reimburse that which they initially avoided paying, all whilst receiving great acclaim and the overlooking of other wrongdoing. Bezos may have been charitable against climate change, but let us not forget that Amazon is a major contributor to the climate crisis, with a whopping 51.17 million metric tonne carbon footprint in 2020.


This pandemic has been a time of great upheaval, but we must not forget that which it has given us. We have been able to see, clearer than ever, the corrupt nature of the billionaire class, thriving whilst others suffer, and prioritising profit over people. We must act and expropriate their riches for the betterment of all members of society.


IMAGE: Flickr / National Museum of American History Smithsonian Institution